Scatec Solar secures $100 million in financing for solar plants in Jordan

Norway-based Scatec Solar and its business partners have received $100 million in financing for the development and construction of three solar power plant projects in Jordan with a combined capacity of 43 MW.

Scatec Solar and Jordanian partners Quest Energy Investment, European Jordanian Renewable Energy Projects and Greenland Alternative Energy have jointly developed the the projects, which are budgeted at a total $135 million.

The European Bank for Reconstruction and Development (EBRD) and the French development agency Société de Promotion et de Participation pour la Coopération Economique (Proparco) are providing the debt financing for the solar plants.

Scatec Solar will construct the plants and provide operation and maintenance services when the plants are completed and in operation.

"Securing financing for the Jordanian projects is an important milestone for Scatec Solar, and an important contribution to meet our ambition of continued strong growth as an independent solar power producer," said Scatec Solar CEO Raymond Carlsen. "I am pleased to see that our approach to team up with local partners and strong finance institutions bring about such great results."

Scatec Solar will own 70% of the 10 MW Oryx plant and 40% of the two other plants totaling 33 MW capacity. The companies expect to complete the plants in the second half of 2015.

The three plants will produce an estimated 104,000 megawatt hours annually and generate revenues of some $17 million a year, according to Scatec Solar. The National Electric Power Company (Nepco) will buy the electricity produced by the plants under a 20-year power purchase agreement. The plants are located near Ma’an City in southern Jordan.

The EBRD and Proparco will provide $50 million each to fund the construction of the three plants — the latest projects in a continuously growing pipeline of impressive PV projects in the country.

Monday’s announcement comes several weeks after the EBRD’s decision to provide a $25 million loan for the construction of a 20 MW solar PV plant likewise located near Ma’an, about 220 kilometers south of Jordan’s capital city Amman. The 20 MW project is also getting an additional $25 million loan from the U.S. Overseas Private Investment Corporation (OPIC) and will be constructed and operated by a 100% subsidiary of SunEdison, the EBRD said in September.

Nandita Parshad, the EBRD’s director for Power and Energy, said Jordan had outstanding solar energy sources and the bank is committed to developing the country’s solar sector and helping it to satisfy its energy supply while also reducing its environmental impact. Jordan currently imports more than 97% of the energy it consumes, relying disproportionately on natural gas from Egypt and oil from Saudi Arabia.

The Jordan power rush

In the last few months, there have been a series of ambitious solar PV projects announced in Jordan, including a 52.5 MW plant and two smaller PV plants, each 10 MW, all located in the southern Ma’an region. The 52.5 MW park will be built by Shams Ma’an Company, which counts the U.S.’ First Solar as a shareholder, while Scatec Solar will also build one of the smaller plants, with Dubai-based Adenium Energy Capital and Portugal’s Martifer Solar jointly building the other.

Scatec Solar saw strong third-quarter growth this year, generating sales of NOK 130.2 million ($19 million) — NOK 100 million more than in the same period last year — and drastically reducing its loss.

The company currently owns and operates 220 MW of solar power plants in the Czech Republic, South Africa and Rwanda.